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Despite reforms, NCCI seeks workers comp rate hike in Illinois

Posted On: Oct. 14, 2011 12:00 AM CST

NCCI Holdings Inc. has asked for a 3.5% increase in workers compensation rates for Illinois next year, despite recent reforms that are expected to reduce the state's workers comp costs.

Karen Ayres, a director and actuary with NCCI, said the proposed rate increase reflects overall loss experience deterioration for Illinois. At a presentation in Rosemont, Ill., this week, the rating and research organization noted that Illinois insurers saw a combined ratio of 123% for 2010, up from 118% in 2009.

Boca Raton, Fla.-based NCCI filed for an 8.8% loss-cost decrease in Illinois after state lawmakers adopted workers comp reform legislation in June. The decrease, which took effect Sept. 1, was based largely on a 30% reduction of Illinois' medical fee schedule under the new law.

Reform and review separate issues

Ms. Ayres, who is based in New Jersey, said the recent decrease reflected only the expected impact of Illinois' workers comp reform and was separate from NCCI's annual rate review.

Illinois manufacturers are expected to see a 4.2% increase in workers comp rates under NCCI's proposed rate filing, while goods and services companies could see a 3.7% increase, according to NCCI's presentation this week. Rates for contractors and clerical companies would rise 2.3% and 1.2%, respectively.

The Illinois Department of Insurance is considering NCCI's rate filing, which was submitted last month, Ms. Ayres said.